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Is Bluetooth a Candidate for Adoption?

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Efforts by cell phone makers to promote Bluetooth-enabled handsets are being stymied by carriers reluctant to buy in to the pricey, slow-growing wireless technology.

In the United States, where phone sales are contingent on carrier support, only Alltel Corp. has agreed to sell a Bluetooth phone. Verizon Wireless Inc., Sprint PCS Services and AT&T Wireless Services all say that Bluetooth is somewhere on the road map, but none has made a commitment.

"Its not unusual for carriers to take a conservative approach with any technology," said Don Baumgartner, business unit manager for universal mobile connectivity at Extended Systems Inc., a Bluetooth developer in Boise, Idaho.

"Its no more [trustworthy] than any other new technology," said Tom Trinneer, vice president of data product development at AT&T Wireless Services, in Redmond, Wash. "Were actively working with our suppliers to ensure that it will be reliable and easy to use."

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"For the carriers, the main issue is the price," said Maria Khorsand, president of Ericsson Technology Licensing AB, in Stockholm, Sweden.

Indeed, industry experts have been saying for years that the price of a Bluetooth transceiver has to be in the neighborhood of $5 for the market to flourish. Most Bluetooth units sell for four or five times that amount.

Among the factors keeping prices high is the reluctance by manufacturers to burn Bluetooth into masked ROM. For now, the technology is relegated to flash memory, which raises production costs.

"Customers are concerned that its not stable enough," said J. Eric Jansen, vice president of North America Sales at Cambridge Silicon Radio, a leading Bluetooth radio manufacturer in Richardson, Texas. Its going to be at least a year before anyone burns Bluetooth into ROM code, according to CSR, which sells radios for many of the qualified Bluetooth products on the market and has recently started getting directly involved with carriers.

There are cost-saving measures in the works. Ericsson has created Bluetooth intellectual property for single-chip radio environments, which makes the radio run faster on less power. This should help radio manufacturers reach the $5 price point, according to Khorsand. Called EBCP RoseRed, the intellectual property should be available by the middle of next year, she said.

In addition to component prices, carriers are concerned about the moneymaking potential of Bluetooth, which runs on the free, unlicensed 2.4GHz band. Unless consumers use the phone to surf the Web, carriers will be hard pressed to collect fees for using the technology.

"A lot of the carriers are uncertain what Bluetooth means to them," CSRs Jansen said. "Why bother? they think. It makes the phone more expensive and doesnt increase revenue."

To that end, Bluetooth proponents are encouraging carriers to get involved with developing future versions of the Bluetooth specification.

Manufacturers report that carriers have requested all sorts of addenda to Bluetooth, including adding Bluetooth capabilities to WAN communications. For example, a camera would talk to a phone via Bluetooth; the phone would then contact another phone via the wide area wireless network. The second phone would talk to a PDA (personal digital assistant) via a Bluetooth connection, and the camera would be able to do service discovery to that PDA to see what kind of data it is capable of receiving.

Carrier involvement could, of course, complicate the Bluetooth standard, which has already been bogged down by numerous companies promoting even more capabilities. But, for now, Bluetooth manufacturers are pleased with the carriers interest because it could lead to further support.

"Carriers are starting to get interested and involved [in the Bluetooth special interest group]," Jansen said, adding that this was less the case with other local wireless specifications such as 802.11b and Home RF.

Beyond that, some developers are concerned that Bluetooth could actually compete with the carrier networks. This is based on the ad hoc mentality that if there are enough wireless networks set up, you will always be close enough to access one.

Massachusetts Institute of Technology Media Laboratory founder Nicholas Negroponte, who attended the Bluetooth Congress here two weeks ago, said that the ad hoc network of wireless LANs was a common occurrence at MIT, in Cambridge, Mass., and that such ad hoc networks could conceivably threaten the carriers. But Negroponte joked that the telecommunications community could easily disrupt the unlicensed 2.4GHz band if it felt like it.

"If youre a common carrier ... you could easily buy a million microwave ovens [which use the same frequency band] and raise havoc by turning them on," Negroponte said.

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